Consortium to seek landmark status for historic towers, a move that could bring a tax break

The Wm. Wrigley Jr. Co. confirmed Monday that the iconic Michigan Avenue towers, along with a nearby 1.5-acre lot, has been sold to a consortium of buyers led by BDT Capital Partners, a Chicago-based investment firm headed by Byron Trott.

As part of the deal, the new owners have committed to a significant renovation of the building's two interior towers, the public plaza that separates them and the ground-floor retail space. They also plan to seek landmark status for the building, a designation that could result in tax breaks.

"It has been our commitment to secure new ownership for the Wrigley Building that will ensure its best possible future use and protect the building's historic legacy," Wrigley Chief Financial Officer Reuben Gamoran said in a statement.

While experts have speculated that the building could be converted into apartments or a hotel, the new owners plan to lease it primarily as office space.

Terms of the deal were not disclosed, but people with knowledge of the situation pegged the price at approximately $30 million.

Tony Smaniotto, a senior managing director at Studley's Capital Transactions Group, said the $30 million figure obtained by the Tribune is in "concert with other older historical properties that might have leasing and physical challenges." That figure, he said, reflects the age of the building and the fact that renovations are required.

Landmark status would enable the owners to seek local and federal tax breaks for the renovation work. Under a Cook County program, the owners could see the Wrigley Building's property taxes reduced for 12 years in exchange for investing at least 50 percent of its assessed value in upgrades. A federal historic preservation tax credit also could be applied to the owners' income taxes, if certain investment criteria are met.

Landmarks Illinois, a statewide advocacy group, has lobbied for years to have the building designated as a landmark. Lisa DiChiera, the group's director of advocacy, suggested that tax breaks might have swayed the new owners to initiate the process.

"The best way to landmark a building is to have incentives offered," DiChiera said.

Paul Zeller, president of Zeller Realty, said in a statement that the firm will work with BDT to "reinvigorate" the historic skyscraper and "give it a vibrant, 21st-century environment," while "celebrating its architecture and tradition."

The redevelopment is expected to be done over the next three to five years.

The skyscraper, known for its clock tower and white terra cotta facade, has been Wrigley's home for nearly a century.

In July, Wrigley announced that it would move its remaining 250 employees from the building by the end of 2012 and consolidate offices on Goose Island, where nearly 500 of employees already work. The company began moving employees there in 2005.

The Wrigley Building, with 460,000 square feet, is about 60 percent occupied. Absent Wrigley, occupancy would be about 35 percent.

Trott, an investment banker who spent most of his career at Goldman Sachs, is best known for his work with Warren Buffett, particularly his facilitation of Buffett's $5 billion investment in Goldman in 2008, during the height of the financial crisis.

In September 2010, BDT purchased a majority stake in City Beverage, Chicago's largest Anheuser-Busch distributorship. The firm also owns a controlling stake in Palatine-based Weber-Stephen Products, the maker of Weber grills.